Solution-Activity rate for the fabrication activity cost

Activity rate for the fabrication activity cost pool

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Reference no: EM13341546

Daniele Corporation uses an activity-based costing system with the following three activity cost pools:

Activity Cost Pool	Total Activity
Fabrication	50,000 machine-hours
Order processing	500 orders
Other	not applicable

The Other activity cost pool is used to accumulate costs of idle capacity and organization-sustaining costs.

The company has provided the following data concerning its costs:

Cost Data
Wages and salaries	$280,000
Depreciation	$200,000
Occupancy	$140,000
Total	$620,000

The distribution of resource consumption across activity cost pools is given below:

	Activity Cost Pools
	Fabrication	Order Processing	Other	Total
Wages and salaries	60%	30%	10%	100%
Depreciation	20%	35%	45%	100%
Occupancy	10%	50%	40%	100%

The activity rate for the Fabrication activity cost pool is closest to _______ per machine hour.

Reference no: EM13341546

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Activity rate for the fabrication activity cost pool

Reference no: EM13341546

Reference no: EM13341546

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